Duxton Farms expands property portfolio
The Adelaide Hills-based investment company is buying two Victorian properties to diversify its portfolio and make up for weather-related losses.
South Australia’s crop production reached a record at 12.8 million tonnes in 2022. Photo: Michael Skopal
Collectively known as Piambie Farms, the properties are located in northern Victoria along the River Murray between Swan Hill and Boundary Bend, with the combined 1183 hectares worth $9,000,000.
Announced this week, the transaction was cut into two stages, with Duxton Farms agreeing to acquire the Glen Innes property worth $1,626,795, with the second stage including an operating lease on the second property, Piambie, to ensure ongoing working possession, valued at $7,373,205.
The operating lease is set to begin in January 2023 with the option being exercisable until July 2023, which is when Duxton expects the transaction to be completed pending final approval by the Foreign Investment Review Board.
Based in Stirling, Duxton Farms was listed in 2017 and recently changed its name from Duxton Broadacre Farms Ltd. to reflect the expansion of the company’s core business activity.
The business, Australia’s only listed, mixed farming enterprise, made InDaily’s South Australian Business Index in back-to-back years, rising from 81 on the 2020 list to 72 last year.
According to the company’s update to the ASX, they plan to continue the current cropping program of irrigated canola and wheat but may look to supplement this with irrigated cotton.
Generally, a productive region, Piambie Farms features soil that is suitable for several summer and winter crops and is currently in a healthy condition, the update stated.
The property averages 315mm of rain per year with 80 per cent of the 935 hectares developed for irrigation, increasing the company’s irrigable capacity by one third.
The purchase expands Duxton’s portfolio, diversifying away from annual crop cultivations and moving more towards permanent horticulture in an effort to mitigate weather-related losses.
The company’s core portfolio consists of eight properties in the Central West of New South Wales that produce wheat, barley, canola, cotton and livestock.
The investment company has thus far seen a difficult season due to a wet winter cropping cycle and flooding but the purchase of Piambie Farms aims to mitigate this through a more diverse portfolio of crops.
The company stated that livestock and summer cropping programs performed well, which helped stabilise the business during the unfortunate weather.
InDaily reported in July that the company reported to the ASX that the value of its total land, water and structural assets increased by 33 per cent to more than $143 million in the past 12 months and it had engaged LAWD to provide an updated valuation report.
Last year’s LAWD report showed an 11 per cent valuation increase from $96.85 million in July 2020 to $107.95 million a year ago.
The South Australia company sold its only SA farm in December 2020 for $22 million, 37.5 per cent above its indicated valuation.
The eighth edition of the 2022 South Australian Business Index will be revealed on 29 September at the Adelaide Convention Centre, with a keynote address by Brett Woods, the President of Midstream Infrastructure and Clean Fuels Division at Santos.
